Contractors demand damages for labor shortage

The Madinah Chamber of Commerce and Industry has called on the Ministry of Finance to pay construction contractors compensation for expatriate worker shortages caused by the recent grace period announced by the government.
This is one of several issues the contractors want resolved by the government. The chamber’s list includes support and technical training for contractors, cutting bureaucratic red tape in tender process, and pre-classification of companies that can bid for major government work.
They want training and a basic minimum wage of SR 3,000 for Saudis employed in the construction industry; and the ministry to conduct a feasibility study to determine current market conditions and ultimately what dues should be paid to companies.
The chamber’s secretary general, Mohammad Al-Sharif, said Madinah has many major projects and there was an urgent need for the government to step in and gather information on the sector’s requirements.
With regard to the expansion program of the Prophet’s Mosque, he said companies should be classified well in advance before they bid for work. Yasir Al-Shiemi, president of the contractor’s committee at the chamber, said there was need to upgrade the administrative, technical and financial capabilities of contractors. They should be made aware of their rights and helped to overcome obstacles when undertaking projects.
Al-Shiemi urged the ministry to increase the number of representatives and financial supervisors at all its branches to speed up payment of outstanding dues.
He said there should be coordination with the traffic department to issue driver’s licenses for workers to deliver cement from local factories.
He added that the “decision to raise the minimum wage for expatriate workers to SR 2,400 is a major obstacle facing contractors.”
Talal Al-Luqmani, a board member of the chamber, said raising the basic salary of Saudi nationals to SR 3,000 was a major issue for contractors. “Contractors should consider all possibilities before participating in any tenders, and the SR 3,000 salary is one of them.”
“This figure is very low for Saudi nationals and should not be less than SR 5,000,” he said. “Those who can’t meet these expenses should withdraw, so as not to obstruct the implementation of projects.”
Fahad Al-Mghayer, a board member, said it was meaningless to force contractors to be classified in Madinah Province because they already have a certificate of classification issued by the municipality. “This has led to many small and medium-sized companies resorting to illegal work,” he said.